Stored value card transaction control systems and methods

ABSTRACT

A gift card processing system which includes a database storing interval information representing a required interval between transactions using the gift card. The database also stores data representing the maximum amount of each transaction. The gift card processing system is part of a network that includes POS terminals at merchant locations, where the gift card may be presented. A card ID is read from the card at a POS terminal and used to access the interval data and the maximum transaction amount data.

CROSS-REFERENCES TO RELATED APPLICATIONS

This application is a nonprovisional of U.S. Provisional PatentApplication No. 60/953,928, entitled “STORED VALUE CARD TRANSACTIONCONTROL SYSTEMS AND METHODS,” and filed on Aug. 3, 2007 (Attorney DocketNo. 020375-084200US), the entirety of which is incorporated herein.

BACKGROUND OF THE INVENTION

In recent years, stored value cards, such as prepaid gift cards, havebecome increasingly popular among consumers. Very often the cards aregiven by a purchaser (of the card) to a recipient in lieu of cash, sothat the recipient will have the means to purchase goods or servicesfrom a card issuing merchant. In some cases the purchaser may desirethis arrangement so that the recipient does not use the card forpurposes other than those intended by the purchaser. As an example, aparent may purchase a stored value card that can be used by a child onlyat the issuing merchant, so that the child may not use the card forgoods other than those sold by that merchant.

One drawback of existing cards is that there is no effective means forcontrolling card use at the merchant. For example, a parent may give acard issued by a restaurant to a child away at college, desiring thatthe child use the card in increments for individual meals. However,there is often no effective means to prevent the child from using thecard in ways not contemplated by the parent. While cards have been knownto place maximum limits on individual purchases (e.g., a $100 gift cardmay only be used in $10 increments), there is no means available toprevent the recipient of the card from conducting many transactions overa short period of time, quickly depleting the value of the card.

BRIEF SUMMARY OF THE INVENTION

There is provided, in accordance with embodiments of the presentinvention, a network/system and method for controlling the use of astored value card, by requiring transactions using the card be separatedby a predetermined interval of time.

In one embodiment, the method comprises providing a card ID for a storedvalue card (e.g., a gift card), storing interval data at a database, theinterval data representing a required interval between transactions thatare conducted using the card, receiving the card ID data at a POS devicewhen the card is used for a transaction, using the card ID data capturedat the POS device to retrieve the interval data, and authorizing thetransaction at the POS device only if the required interval has passedsince the last transaction. In some embodiments, each transaction islimited to a maximum transaction amount, thereby preventing depletion ofcard value over a short period of time.

A more complete understanding of the present invention may be derived byreferring to the detailed description of the invention and to theclaims, when considered in connection with the Figures.

BRIEF DESCRIPTION OF THE DRAWINGS

FIG. 1 is a general schematic diagram showing a network for activatingand using gift cards.

FIG. 2 illustrates gift card data table in the database seen in FIG. 1.

FIG. 3 illustrates card restriction data table in the database seen inFIG. 1.

FIG. 4 is a flow diagram illustrating the operation of the networkduring activation and use of a gift card, according to one embodiment ofthe invention.

DETAILED DESCRIPTION OF THE INVENTION

There are various embodiments and configurations for implementing thepresent invention. One such implementation is shown in FIG. 1, whereaccording to an embodiment of the invention, a network 100 isillustrated in which stored value cards, such as an illustrated giftcard 102, may be activated and then subsequently used for conductingtransactions.

The gift card 102 carries a card identifier (ID) or other identifyingdata, such as may be present on a magnetic stripe. However, gift cardsand other stored value cards may carry identifying data using manydifferent means, such as (by way example only) a memory chip, an RFID(radio frequency identification) tag, a bar code, and other storage orinformation carrying devices.

The network 100 includes POS terminals or devices 116 at variousmerchant locations, used for purchasing cards that may be stocked ordisplayed for sale at the merchant locations, and that, afteractivation, may be subsequently used for conducting transactions. ThePOS terminals 116 may be either clerk operated or self-service, and havecard readers (e.g., magnetic stripe readers) for reading the ID on thecard 102. The POS terminals are connected through a retail network 120to financial networks (e.g., credit and debit card processing entities,banks and other financial institutions) for purposes of authorizing andconducting credit card and other transactions. In addition, the retailnetwork 120 is connected to a gift card processing system 126,illustrated in FIG. 1 as including a gift card database managementsystem (DBMS) 130 and an associated database 132. The gift card DBMS 130manages (e.g., stores, accesses and updates) gift card data in thedatabase 132, as will be described below.

The network 100 as described above is known, and detailed descriptionsof its structure and operation can be found, for example, in U.S. patentapplication Ser. No. 10/665,984, filed Sep. 19, 2003 by McGee et al. andentitled “Financial Presentation Instruments with Integrated Holder andMethods for Use,” U.S. patent application Ser. No. 11/122,414, filed May4, 2005 by Seifert et al. and entitled “System and Method for Accountingfor Activation of Stored Value Cards,” and U.S. patent application Ser.No. 11/382,866, filed May 11, 2006 by Jennings, Jr. et al. and entitled“Security Systems for a Payment Instrument,” all of which areincorporated herein by reference.

Briefly, in the operation of network 100, a customer visits a merchantor other location where the cards are displayed for sale, selects a cardfor purchase, and provides it to a clerk at one of the POS terminals116. The card ID is captured (electronically read or manually entered)at the POS terminal 116. After the customer has paid for the card, thegift card DBMS 130 activates the card and stores a record of theactivation in the database 132. In some cases the card 102 may have apre-established face value (say, $100). In other cases, the card may beloaded with a monetary amount or have other terms selected by thepurchaser, in which case such information is established at the time ofpurchase and then stored in database 132.

If the card is then provided to another person as a gift card, thatperson as the recipient and card user may subsequently present the cardat a merchant location when making a purchase. The ID on the card isagain read at one of the POS terminals (either with the assistance of aclerk, or at a self-service terminal. The identifying data (along withtransaction information, such as the purchase amount) is provided toDBMS 130, which determines whether the card is both valid and activated(by comparing against records at the database 132), and if so, deductsthe amount of the purchase against the value stored on the card (asreflected in database 132).

In accordance with embodiments of the invention, the network 100 andgift card system 126 include features to control or restrict the use ofcard 102 in order to prevent the card from being used by the card useror recipient in such a way as to deplete its value over a period of timethat is less or shorter than that desired by the purchaser of the card.Such features are implemented, in one embodiment, by programming coderesident at DBMS 130, along with data/parameters stored in database 132.

In some embodiments, there is associated with each card (and itsidentifying data or ID) a card category or type which determines certaincard restrictions, such as the required interval of time betweentransactions by the card user, and the permitted maximum amount of eachtransaction. Accordingly, and as illustrated in FIG. 2, there isprovided a table 210 within gift card database 132 that stores inassociation with each card ID, a card type 220 as well as a currentbalance 230 for that card. The card type may reflect various features orcharacteristics of the card. As examples, the card type may reflect theface amount of the card (if the card has as predetermined face value),or a card theme (e.g., a holiday gift card, a birthday gift card, aspecial promotional card for certain products offered by the merchant,and so forth). As mentioned earlier and as implemented in someembodiments described herein, the card type may also reflect whetherthere are certain restrictions or controls on the use of the card, andthe nature of parameters associated with such restrictions.

In the table 210 seen FIG. 2, it is assumed that the illustrated cardtypes “0001” and “0002” have no restrictions, but that card type “0007”may have certain restrictions. When the DBMS 130 accesses database table210 and determines that a card has a card type designation (e.g.,“0007”) that indicates there may be restrictions associated with thecard, the DBMS then accesses a card restriction table 310 associatedwith that card type, such as seen in FIG. 3.

In the table 310 of FIG. 3, there are two restrictions that may beactivated with each card represented (by its card ID) within that table,specifically, a required interval between transactions and a maximumamount that may be conducted or posted for each transaction. Thus, thereis associated with each card ID (having a card type “0007”), a last usedate 320 reflecting the date of the last transaction for which the cardwas used, a required interval 330 reflecting the number of days thatmust have lapsed or passed between the last transaction and the nexttransaction, and a maximum transaction amount 340 reflecting the maximumamount of each transaction permitted when using the card. In addition,the table 310 has a restriction activation flag 350 associated with eachcard that is set based on whether the restrictions have been put inplace on the card when the card is purchased.

As will be described in greater detail later in conjunction with FIG. 4,when a transaction is conducted using a card having a card type in table210 indicating a restricted card, the DBMS 130 accesses table 310 andallows a transaction only if the transactions meets the parameters orrestrictions as reflected in table 310. As an example, if the cardhaving the card ID ending in the digits “1236” is presented at a POSterminal 116 for a transaction, table 310 indicates that the lasttransaction occurred on May 30, 2007 (“05302007”), that the nexttransaction must be at least one day later (“1”), and that a five dollarmaximum (“5”) is permitted for each transaction. The current transactionis authorized at DBMS 130 only if the transaction meets thoserestrictions.

Referring now to FIG. 4, there is seen a flow diagram illustratingvarious steps within network 100 for activating and then subsequentlyusing the card 102. Such steps may be implemented at least in part byprogramming resident within DBMS 130, in conjunction with the POSterminals 116 and retail network 120.

As seen, the customer first selects a gift card 102 at one of themerchant locations (step 410). The customer presents the selected cardto a clerk at one of the POS terminals 116 at the merchant locations,where the card identifier or ID is read by swiping the card at a cardreader at the POS terminal (step 412). The POS terminal transmits thecard ID to the gift card DBMS 130 (step 414), which determines whetherthe card ID is valid and available for activation (step 416). The cardpurchase is declined at step 416 if the card ID is not valid or is notavailable (e.g., a card having the same ID has been previouslyactivated, or is one reported as stolen). Otherwise, the processcontinues.

The card being purchased is assumed to be one for which the purchasermay elect restrictions (such as one having a card type “0007” describedearlier in conjunction in FIGS. 2 and 3), and the gift card DBMS 130requests that clerk at the POS terminal make various selections inconnection with the activation of the card, pursuant to instructionsfrom the customer purchasing the card (step 420). As described earlierin conjunction with FIG. 3, such selections may include affirming thatthe card is to be restricted (a “y” for the restriction activation flag350), the number of days that are permitted between transactions for therequired time interval 330, and the dollars for the maximum transactionamount 340.

After making the restriction selections, and paying the purchase price,the card is activated (step 422). The purchaser subsequently gives thegift card to the recipient or card user (step 424), so that therecipient may use the card to make a purchase by presenting it at one ofthe POS terminals 116 at a merchant location where the value of the cardis being redeemed (step 426). The clerk at the POS terminal 116 swipesthe card as part of the purchase or redemption (step 428), and the giftcard ID and transaction data (e.g., amount of the transaction) is sentfrom the POS terminal 116 to the gift card DBMS 130 (step 440). The DBMS130 determines at step 442 whether the transaction amount exceeds thepermitted maximum that was selected at step 420, and that can be foundwithin table 310. If exceeded, the transaction is declined. If notexceeded, the DBMS then determines whether the required interval betweentransactions has been met (step 446), by looking up the last use date320 and the required interval 330 at table 310. If the required intervalis met, the transaction is completed (step 450) and the amount of thetransaction is deducted from the balance 230 in table 210. If thetransaction is attempted before the expiration of the required interval(step 446), the transaction is declined.

While a detailed description of presently preferred embodiments of theinvention has been given above, various alternatives, modifications, andequivalents will be apparent to those skilled in the art without varyingfrom the spirit of the invention.

For example, the flow diagram in FIG. 4 is only one embodiment of aprocess that could be carried out by program steps within the network100. Additional steps may be performed, some steps deleted, and theorder of steps may be changed. Further, in an alternative embodiment,the gift card 102 may have a pre-established interval and apre-established maximum transaction amount, without being selected bythe purchasers. In such case the restriction selections by the purchaserat step 420 (FIG. 4) could be deleted (i.e., the restrictionsrequirements would be established within database 132 based on the typeof card, rather than by purchaser selection). As another example, whilethe described embodiments pertain to a gift card, other embodiments mayemploy other types of stored value (SV) cards, such as (but not limitedto) debit cards, prepaid credit cards, prepaid telephone cards, andprepaid money transfer cards. As yet another example, the cardrestriction table 310 could store a required maximum interval betweenuses, and compare that to the last use data. If too much time haselapsed since the last use, an alert could be generated at processingsystem 126. The alert could be sent back to the POS terminal 116 or to athird party (e.g., via email). This might be designed, e.g., so that aparent is assured that his child is using the card at frequent enoughintervals, if the card is being used for necessities such as food,medicine, and so forth.

Also in some embodiments, the SV card need not be a physical card atall. It could be an issued number, PIN or alphanumeric code representingan SV account (e.g., as maintained in database 132), with the coderemembered and used by the card user when conducting a transaction.

Therefore, the above description should not be taken as limiting thescope of the invention, which is defined by the appended claims.

1. A system for processing transactions using a stored value card,comprising: a POS terminal for capturing card identifying informationwhen the card is used for a transaction; a database storing, inassociation with the card identifying information, transaction intervaldata defining a required time interval between transactions using thecard; and a management system for accessing the database in response tocard identifying information captured at the POS terminal andauthorizing a transaction at the POS terminal only if the transactionsatisfies the required interval between transactions.
 2. The system ofclaim 1, wherein the database further stores card type data for eachcard; wherein the interval data is stored for each card in associationwith the card type data for that card; wherein the card identifyinginformation for an card captured at the POS is used to access the cardtype data in the database for that card; and wherein the accessed cardtype data is used to access the interval data for that card.
 3. Thesystem of claim 1, wherein the interval represented by the interval datarepresents a required number of days since the last transaction.
 4. Thesystem of claim 1, wherein the interval data includes the date of thelast transaction and a permitted number of days between the lasttransaction and the date of the present transaction.
 5. The system ofclaim 1, wherein the management system limits the transaction to apredetermined monetary amount.
 6. The system of claim 1, wherein thestored value card is a gift card having a predetermined monetary value.7. The system of claim 1, wherein the stored value card is purchased bya purchaser, and where the purchaser selects the required interval whenactivating the card.
 8. A system for processing transactions using astored value card, comprising: POS means for capturing card identifyinginformation when the card is used for a transaction; database means forstoring, in association with the card identifying information,transaction interval data defining a required time interval betweentransactions using the card; and a management system means for accessingthe database in response to card identifying information captured at thePOS means and authorizing a transaction at the POS means only if thetransaction satisfies the required interval between transactions.
 9. Amethod for processing stored value card transactions, comprising:providing a card ID for a stored value card; storing interval data at adatabase, the interval data representing a required interval betweentransactions that are conducted using the card; receiving the card IDdata at a POS device when the card is used for a transaction; using thecard ID data captured at the POS device to retrieve the interval datafrom the database; and authorizing the transaction at the POS deviceonly if the required interval has passed since the last transaction. 10.The method of claim 9, wherein the database further stores card typedata for each card; wherein the interval data is stored for each card inassociation with the card type data for that card; wherein the card IDdata for an card received at the POS is used to access the card typedata in the database for that card; and wherein the accessed card typedata is used to access the interval data for that card.
 11. The methodof claim 9, wherein the interval represented by the interval datarepresents a required number of days since the last transaction.
 12. Themethod of claim 9, wherein the interval data includes the date of thelast transaction and a permitted number of days between the lasttransaction and the date of the present transaction.
 13. The method ofclaim 9, further including the step limiting the transaction to apredetermined monetary amount.
 14. The method of claim 9, wherein thestored value card is a gift card having a predetermined monetary value.15. The method 9, wherein the stored value card is purchased by apurchaser, and where the purchaser selects the required interval whenactivating the card.